he United States Securities and Exchange Commission (SEC) approved the listing and trading of several spot Ether ETFs filed by major investment firms including BlackRock, Fidelity, Grayscale, Bitwise and VanEck. However, unlike the earlier approval of spot Bitcoin ETFs on January 10, 2024, SEC Chairman Gary Gensler did not explicitly vote to approve the Ether ETFs applications.
Instead of an official vote by the five SEC commissioners as was done for Bitcoin ETFs, the spot Ether ETF approvals were granted by the SEC's Division of Trading and Markets using delegated authority. James Seyffart, an ETF analyst at Bloomberg, noted this type of approval without an official commissioner vote is common for many SEC decisions to prevent slowing down the process.
Gensler's Reluctance
So why did Gensler not vote to approve spot Ether ETFs as he had for Bitcoin? Some key factors are at play. As an SEC chairman appointed by President Biden, Gensler faces political pressures. He has taken a generally cautious stance on crypto and emphasized the need for more regulatory frameworks. In congressional testimony last year, Gensler expressed doubts that Ether meets the standards to not be considered an investment contract and therefore a security.
Implications Going Forward
While the Ether ETF approvals are a positive step, some differences from the Bitcoin ETF approval may have implications. First, the Ether ETFs still need to file S-1 registration forms with the SEC before being available on markets, which could delay their listing timeframe. Gensler's non-support also suggests ongoing regulatory uncertainty around Ethereum. And his reluctance leaves open the possibility of objections to the decision in the following 10 days. Overall, crypto proponents and the financial industry still seek more clear regulatory clarity and guidance from the SEC.
